I work at a Toyota Dealership and we get about 12 TRD Pro's a year. This includes Tundra, Tacoma and 4runner. We also get calls and internet leads almost daily on them. We hardly ever even have a TRD Pro hit the lot as they are often sold before they get to our dealership. We charge $1,500 over MSRP for the Pro's and few if any customers have a problem with that. If they've done their research they know they are very hard to get and the value reflects that. In fact, the TRD Pro's are one of the only new vehicles that we make any profit on in the front end of the deal because we sell pretty much every other new vehicle at or below dealer invoice. Though I agree that the example the writer cites is slightly ridiculous, if someone is willing to pay that what makes it wrong? Who are you to judge what value someone places on a Tacoma TRD Pro? I encourage the writer to go look at slightly used TRD Pros online because he will find that they are often priced above what the vehicles MSRP was when it was new. So my question to the writer would be is only the private owner able to cash in on the demand for the TRD Pro's? Or should they too be subject to the MSRP price ceiling??

That's a good point with all things purchased, not just cars. I know I've purchased new old stock items on eBay that were five times more than their original price. My family thinks I'm crazy, but like you said, if someone want something and is willing to pay, it really is no one's business but his own. Companies are not charities, their sole purpose is to make a profit, and if a corporation, to also create shareholder wealth. If a price of an item is beyond the pale, then no one will buy it and the price will come down...just like on eBay.

so you're telling me that Charles Maund Toyota *lost* money on the Camry SE that I bought because negotiated just about $5k off of the sticker? that's not how sales works. the salesman and the sales manager wouldn't have done the deal if they were *actually* going to lose money. well, you may say, that they'd make money on the interest of my loan and the services I get through the service department...except for the fact that they gave me a 0% loan and the first 2 years of maint are free. no company or establishment makes a deal where they actually lose money!

charging over sticker is unethical on cars is unethical for a number of reasons.

first, they are depreciating assets. except for the most exclusive limited and special edition boutique sports cars, there is not a single car on the planet that does not initially depreciate. most always depreciate until they are worth the same as scrapping the car itself. there are a handful, some quicker than others, that develop a 'pet rock factor' or become 'collectors items' like some old Ferraris and the Toyota FJ Cruiser. this usually stops depreciation or even causes those cars to appreciate in value. second, you say that you charge the prices because that's what people are willing to pay; but what if you were the only Toyota dealer in your entire state? would charging $10k, $20k etc extra because you're the only spot to get a Toyota be ok? no, it would be ridiculous. you cannot hold buyers hostage over it.

To quote my grandfather; "it sounds like you want to keep it more than I want to buy it." Earlier this year my local Toyota dealer had 2 Tacoma and 3 4Runner TRD Pro models sitting on the grass out front in your choice of white or cavalry blue, I'm sure a quick internet search can save the savvy buyer from most dealers' bogus markup.

Dealers continue to pad sticker prices because people continue to pay padded sticker prices. It ain't that hard to understand.

the average person also buys a car because it's better than their old one and it looks cool. people rarely do research these days...so if you took my Camry and put a $6000 markup on it because of "market adjustments" like in the article. you could say that my specific Camry has a certain combination of options at the SE trim that is in super high demand. there would be a certain number of people that believe you. the TRD Pro is a low-volume trim and because of that I would bet people are more willing to believe it...but that doesnt make it ethical.

Nobody likes the dealer model period. It just takes all the fun out of buying cars.

I wish you could just build the car you want on the website configuration and place your order online. I finance with my own bank who doesn't try to sell me warranty gimmicks or other nonsense. All we really need is manufacturer owned and operated demo/service centers; where we come to pick up our car. I hear Tesla does it this way, but I never bought one so I am not sure what it's like.

Nothing says "beta male" like someone who is intimidated by the car dealership experience. You're the consumer! You hold all the power! Walk out the door and go to the competitor 5 miles down the road if you don't like the pricing and how you're treated!

Nothing says "beta male" like someone who is intimidated by the car dealership experience. You're the consumer! You hold all the power! Walk out the door and go to the competitor 5 miles down the road if you don't like the pricing and how you're treated!

Nothing says "beta male" like someone who is intimidated by the car dealership experience. You're the consumer! You hold all the power! Walk out the door and go to the competitor 5 miles down the road if you don't like the pricing and how you're treated!

Spare me the sales BS.... I don't wanna hear it. I know, I know more about cars than the fool tryin' to sell me one. I am not interested their financing gimmicks or special promotions; I already know what the car is supposed to cost. I didn't come here to play their stupid games, I am here to buy a car.

If it were up to me, I'd do the whole thing online and never talk to a dealer; other than showing up to pick up the car I already bought.

Nothing says "beta male" like someone who is intimidated by the car dealership experience. You're the consumer! You hold all the power! Walk out the door and go to the competitor 5 miles down the road if you don't like the pricing and how you're treated!

Austin, be fair. You are a salesman. You do this for a living, or at least did in the past. You understand the game, and you know when the time to walk comes or not. For most folks, this is the second largest purchase they make in their life, after buying a home, and they do it probably once every 5 years or so. When the game is stacked against the player, it's like a kid going to a carnival and being expected to excel at the games over the carnies. It doesn't work that way, and dealerships are flat out evil. When all you can do is go to another rigged game, really, how is walking away doing the buyer any good when the whole thing just repeats at the new store?

Austin, be fair. You are a salesman. You do this for a living, or at least did in the past. You understand the game, and you know when the time to walk comes or not. For most folks, this is the second largest purchase they make in their life, after buying a home, and they do it probably once every 5 years or so. When the game is stacked against the player, it's like a kid going to a carnival and being expected to excel at the games over the carnies. It doesn't work that way, and dealerships are flat out evil. When all you can do is go to another rigged game, really, how is walking away doing the buyer any good when the whole thing just repeats at the new store?

If people don't like to haggle, and/or pay MSRP, just do the simple thing. I ordered my Wrangler online from my insurance company, picked out every option, and they guaranteed at least 10% off MSRP from a local dealer. I suppose I could have knocked myself out haggling with a dealer, but for me, the 10% off MSRP was fine, especially since I re-sold it six years later for 75% of what I paid.

If people don't like to haggle, and/or pay MSRP, just do the simple thing. I ordered my Wrangler online from my insurance company, picked out every option, and they guaranteed at least 10% off MSRP from a local dealer. I suppose I could have knocked myself out haggling with a dealer, but for me, the 10% off MSRP was fine, especially since I re-sold it six years later for 75% of what I paid.

You start with the sales guy working you, this eventually leads to a sales manager playing the hero bit; then it ends with a finance guy trying to sell some BS extended warranty program or some kind of financing gimmick.

The only part I actually like is picking out the car and going on test drives; the rest of it is a pain the ass.

Nothing says "beta male" like someone who is intimidated by the car dealership experience. You're the consumer! You hold all the power! Walk out the door and go to the competitor 5 miles down the road if you don't like the pricing and how you're treated!

I cannot roll my eyes hard enough at this statement. beta male...good god do you call women "queens" and then s**t shame them when they already have boyfriends? I honestly thought male society had evolved past that, but maybe it's because I don't usually hang out with the stereotypical frat guy any more.

there's nothing wrong with wanting a more pleasant experience at the car dealership. to be honest, my last experience was absolutely awful. I was harassed for 6 weeks by this dealer after they accessed my TrueCar inquiry, tried to get me to buy a version of my Camry that was $6k more than the one I wanted, and then refused to give me the TrueCar price because they argued the car was different than my inquiry because the DEALER put a window tint on it and replaced the rear cig lighter with two USB ports. Ridiculous! I ended up taking them to the cleaners over the car, but it is what it is. not everyone has that skill, and that's not the consumer's fault. car dealers shouldn't be able to take advantage of people because they don't have the skill to negotiate or simply don't want to. not everyone works in sales, not everyone does boatloads of research, and not everyone feels like dealing with the unnecessary conflict and harassment that car dealerships put you through.

Nothing says "beta male" like someone who is intimidated by the car dealership experience. You're the consumer! You hold all the power! Walk out the door and go to the competitor 5 miles down the road if you don't like the pricing and how you're treated!

That's the root of the problem right there; I want a straightforward buying experience, not to fight someone to the death over leadership of the gorilla troop. Literally no other large purchase you make in this country is as stacked against the consumer.

If you can find it for a better price anywhere in the nation, buy it and either drive it back or have it shipped. Most dealers only do this if others are as well. Otherwise don't buy the vehicle or if you need to have it for some reason, pay the dealer markup.

The PT Cruiser arrived at a time when retro was all the fashion rage, and at a time when cars of its type weren't all that good. It got you noticed. But it sold too well to maintain any sort of exclusivity or attention-drawing power. Paying over list depends on how you value things. For some people, being the first on the block has a personal value to it that could not be replicated by purchasing the vehicle once the price comes back to terra firma. It's all relative. One could say that it makes more sense to buy a CPO than a brand new example, but a lot of people want to be the first to drive their car. Unless you buy well something exotc, every ride is going to go down in value big time in the first 2 to 5 years. Some have less depreciation than others, but those are the popular ones or the ones in shorter supply. So you will pay more for your lower depreciating car initially. Meanwhile, the car with higher depreciation can be bought at big discount initially, so factoring in what was initially paid with depreciation, it's usually a wash. But the guy who wouldn't be caught dead in a competing model with high depreciation can justify his purchase in part by pointing to its low depreciation. It seems to me that car buying is one of the instances where the free market works pretty well. The dealer is in business to make money, but if his markup doesn't fly off the lot in due time, it will be the first casualty of the buying negotiations.

A legacy of the local cost of living vs the internet age. The cost of living in Santa Barbara is 254% the US national average, and the median home price is $1,142,700. If it costs that much to live in Santa Barbara, dealership owners and workers have to make more money to live there too. We are spoiled by the ability to easily buy from the other end of the country, and it is conflicting with the insane Californian cost of living. I suppose Californians did this to themselves by not wanting to move to Mississippi.

If the cost of living is high enough people will leave; which is exactly what California needs.

The concept of "markets" is great, because problems like this end up solving themselves.

We in Nevada are bearing the brunt of California's policies. Approximately half of new residents in Las Vegas are from California (80% of our new home buyers in our community). But they have made so much on their houses there, they are pushing the prices up here. We're told the reality will bear fruit down the road, though, as once they are legal residents, they vote for the same type of people they did in California, making our State more like them with the taxation, sanctuary cities, oppressive business regulations, etc. But right now, we have no state income tax so we're hoping they don't vote that in. But it might be cheaper to purchase a vehicle in California. Here, we have to pay the full 8.25% sales tax on a vehicle, plus expensive registration, but again, no income tax, and my wife and I still whittle down the costs of our champagne buffets to less than $4 a person, so we're happy.

We in Nevada are bearing the brunt of California's policies. Approximately half of new residents in Las Vegas are from California (80% of our new home buyers in our community). But they have made so much on their houses there, they are pushing the prices up here. We're told the reality will bear fruit down the road, though, as once they are legal residents, they vote for the same type of people they did in California, making our State more like them with the taxation, sanctuary cities, oppressive business regulations, etc. But right now, we have no state income tax so we're hoping they don't vote that in. But it might be cheaper to purchase a vehicle in California. Here, we have to pay the full 8.25% sales tax on a vehicle, plus expensive registration, but again, no income tax, and my wife and I still whittle down the costs of our champagne buffets to less than $4 a person, so we're happy.

If the cost of living is high enough people will leave; which is exactly what California needs.

The concept of "markets" is great, because problems like this end up solving themselves.

to be fair though, people that buy those high-end homes have a much higher incidence of buying high-end and very high-end cars. I'm sure that Toyotas and Chevrolets still sell well, but the 1% of the 1% are *rarely* buying Corollas even for their kids.

I worked at a dealer that had a sticker markup on every car. What we were taught to do was to reassure the customer that they could ignore the sticker, don't worry about it, we'll work out the details inside. Most important thing was to get the customer to drive the car and get attached to it. Then they got the foursquare sheet disguising the markup. The top producing salesman by far was the "fleet guy" who had permission to set his own pricing and not go to the manager for a $250 discount off a marked up price.

The dealer is still there, under different management. The practice they have now is more insidious - when they bring back their offer, they will have the car marked down to a price that is quite reasonable for the market. Then they will tack on a warranty at an outrageously inflated price. I think they wanted to charge me $8000. Of course you reject it if you see it, then you go to finance. The real negotiation goes on in finance rather than with the front line salesman. This is when they bring out their hard sell tactics. First they offer the warranty at a reduced price, which is still too high. You say no, they make another offer, you say no, if you could sell it at that price then why didn't you offer that price in the first place? Then they go after service contracts and other BS addons. Sigh.

That's the whole issue with dealerships. They don't play the game. They create the game, they set the rules, and they change the rules as they go along. An average consumer cannot keep up with the thousands of angles used to get them to sign, and as a result, they lose to the house. Imagine going to a grocery store and haggling with the clerk when checking out over every item, only to be told that the transaction is predicated on you using the store's charge account, or signing up for a cooking plan, or some other crap tacked on well into the process? Amateurs should never play against pros, and the pros work at dealerships, often as Finance Managers. It's a rigged system, and very, very few consumers ever get a truly fair deal.

That's why I say car shopping way less fun than it could/should be. Imagine if we could skip all that crap and just make it all about the car!

You can, depending upon what you're buying.

The more that it's a commodity car/truck/S-CUV, the easier it is to level the playing field. Simply email the sales manager (or whomever) at each dealership with which you're willing to deal, sharing with them the vehicle configuration you're prepared to buy that week, and ask them for their price. Do it in the last few days of a quarter, contact a LOT of dealers, and you're likely to receive two or three offers that have the capacity to surprise you. You can do this by phone, too, but it takes longer and you're back playing the game in their court.

The reason to contact a lot of dealers is that a few of them will have vehicles they want off their lots ASAP; the trade-off is that being picky about color or requiring a non-standard-for-your-region configuration will see to it that you get no offers of interest.

I've done this with my last four commodity-type vehicles and have only gone in to the dealer to pick the vehicle up, or to sign additional paperwork associated with them delivering the vehicle to me in my state. I'm generally in and out in an hour or so. I've paid cash so the whole finance manager part is "No. No. No, thanks. No. No. No thanks. We're done, right?" I could be wrong, but I'm guessing that if you've got financing set up ahead of time you can still get in and out lickety-split.

Now, this isn't going to work for P-cars, M4 CS', Ferraris, etc., etc. Those cars are so incredibly special that you have to pay homage to the dealers by paying whatever they claim they have to have. "Oh yes, it lists for $153,902 - but, if you want one before 2023 I can move you up the list with a 'deposit' of [pick a truly outrageous number]." That one is a clue that you're not only not getting the car now, you're probably not getting it in 2023, either.

I could go on, but yeah...it's an ugly business - but not one that's impossible to win at. Sort of, anyway!

The more that it's a commodity car/truck/S-CUV, the easier it is to level the playing field. Simply email the sales manager (or whomever) at each dealership with which you're willing to deal, sharing with them the vehicle configuration you're prepared to buy that week, and ask them for their price. Do it in the last few days of a quarter, contact a LOT of dealers, and you're likely to receive two or three offers that have the capacity to surprise you. You can do this by phone, too, but it takes longer and you're back playing the game in their court.

The reason to contact a lot of dealers is that a few of them will have vehicles they want off their lots ASAP; the trade-off is that being picky about color or requiring a non-standard-for-your-region configuration will see to it that you get no offers of interest.

I've done this with my last four commodity-type vehicles and have only gone in to the dealer to pick the vehicle up, or to sign additional paperwork associated with them delivering the vehicle to me in my state. I'm generally in and out in an hour or so. I've paid cash so the whole finance manager part is "No. No. No, thanks. No. No. No thanks. We're done, right?" I could be wrong, but I'm guessing that if you've got financing set up ahead of time you can still get in and out lickety-split.

Now, this isn't going to work for P-cars, M4 CS', Ferraris, etc., etc. Those cars are so incredibly special that you have to pay homage to the dealers by paying whatever they claim they have to have. "Oh yes, it lists for $153,902 - but, if you want one before 2023 I can move you up the list with a 'deposit' of [pick a truly outrageous number]." That one is a clue that you're not only not getting the car now, you're probably not getting it in 2023, either.

I could go on, but yeah...it's an ugly business - but not one that's impossible to win at. Sort of, anyway!

My father in-law does it that way. He won't make his deal in person; does it all over phone and email.... Yet they know you have to go there to sign in person and they always try some kind of bs when you get there.

Indeed. Unless you've got a P-car fetish or another version of the I've-just-gotta-have-it! problem, paying what the dealers are asking generally isn't necessary.

I bought my last Tundra for $5200 under invoice, and my last BMW for a flat $10K under MSRP (BMW dealers don't seem able to discuss "under invoice" pricing :rolleyes). Even under-invoice pricing doesn't mean what it used to - invoice prices get closer and closer to MSRPs with each passing year.

I worked with my insurance company rather than a dealer to get my Wrangler, so I just picked it up at one of our Jeep dealers. Everytime I'd go down there for oil changes, though, I'd walk around the lot and see virtually every new vehicle for sale had a "market adjustment" figure tacked onto the MSRP...sometimes it was a much as $5K for something like a Dodge Challenger or Chrysler 300. I suspect most people on this site never pay MRSP, but to think there might be some people somewhere who might pay over MSRP is really scary.

OK, OK, I will admit that I paid sticker because I bought literally the second-ever Miata PRHT I saw in person. It was new, it was exactly what I wanted, this one was even the right color combination, and I'd just received a substantial raise at work. And for the first year before they really started getting out there, I felt like the Cheshire Cat putting the top through its paces anywhere people were around to see.

But I was out of my chair and headed to the door with their first financing APR offer. Holy Jay-zuz, not with my credit score. To their credit, they came back to reality real quick there.

the Honda dealers in my area are awful about pricing as well. honestly, it's the reason that my decision between the Camry and Accord was so easy; the Honda dealer was not budging on pricing and was bragging that in December 2017 they were still charging $500 under MSRP for most of the 2017 models on the lot. had the dealer been more willing to negotiate like the Toyota dealer was I would have much more seriously considered the Accord. I can afford both cars even without negotiation, but the Accord was not worth $5000 more plus 3.9% interest on the loan vs the Camry.

I was looking for a 2018 Raptor for months but refused to pay MSRP or up to 10k over that many dealers were asking. Finally picked one up in March exactly the way I wanted it for $3500 below MSRP. Had to drive 400 miles round trip but it was worth it. Amazing truck!

lol @ sticker, change that to invoice. I have never purchased a new car over invoice including my SRT and multiple BMW's. Believe it or not even at invoice the dealer is making money. They know it, you know it. The only thing that does not go at invoice is special edition sports cars (although its pretty easy to get vette at around invoice), porsche, exotic cars. Dont believe the hype and widen your search radius or wait a few more months after you intended, there is always a deal. Best ofcourse is usually not buying new but almost new or at auction. Some crazy depreciation deals exist. The only reason I got my SRT new was the forever warranty. Note you may have to wait for the right month to buy your chosen brand at yearly lows. Dont worry, unlike avocado they dont expire. Also dont have a super crazy restricted list of car options (unless you dont like saving money).

To those that b***h about a dealership making a profit, what business survives with no profit?

A vehicle is the second largest purchase to a home for most people. Do real estate agents not make a hefty commission? Does the bank not make a TON of interest off your mortgage? Do you go to the store and demand invoice pricing on everything?

Price Price Price...

But I when you sell your car I bet you’re one of those guys that bust out the receipts for the remote starter and rubber floor mats to justify your asking price.

It’s a joke and by the way, all the “savvy” buyers that helped feed companies like Truecar and Edmonds and so on, you made cars more expensive.
Much to your surprise, a business cannot survive when it sells everything at invoice. So, manufactures have just simply increased prices so that they can pay their dealerships at the end of the month in the form of bonuses. I’ve heard people trying to negotiate for that money too like a blood sucking leach.

Real estate agents make a fixed commission, a percentage of the selling price. If car dealerships worked like that, I think fewer people would hate them so much. The difference is that dealerships have about a dozen little places they will try and squeeze as much money as possible from. It's a game. Some people like playing games, but most don't.

I don't think people really have an issue with dealers making a profit. It's the way the whole car buying experience is structured that people are sick of. It's too easy to rip-off the consumer and it can be very difficult to determine what is a fair price for a particular car. People don't like feeling as if they got ripped off, and most don't like playing games. Also, when you mention about the dealer bonuses and that you've "heard people trying to negotiate for that money too like a blood sucking leach" it gives me the impression that the Manufacturer-Dealer relationship is structurally broken as well. I have no work experience at a dealership so I can't speak from experience. That's just the impression I get from you and other stories that have been told.

In the end, it seems everyone loses. I really wish things would just be as simple as charging a fair price for a well-made product that people like & enjoy and that the manufacturer/dealer/salesperson can make a little money from the sale.

I don't think people really have an issue with dealers making a profit. It's the way the whole car buying experience is structured that people are sick of. It's too easy to rip-off the consumer and it can be very difficult to determine what is a fair price for a particular car. People don't like feeling as if they got ripped off, and most don't like playing games. Also, when you mention about the dealer bonuses and that you've "heard people trying to negotiate for that money too like a blood sucking leach" it gives me the impression that the Manufacturer-Dealer relationship is structurally broken as well. I have no work experience at a dealership so I can't speak from experience. That's just the impression I get from you and other stories that have been told.

In the end, it seems everyone loses. I really wish things would just be as simple as charging a fair price for a well-made product that people like & enjoy and that the manufacturer/dealer/salesperson can make a little money from the sale.

Well it’s going to set pricing now so sales people used to have a shot of making 6 figures if they really tried to making 50k.

The part that’s irritating is a lot of people that don’t want to be ripped off are ripping off the sales team (below invoice offers, shopping 20 dealerships to save $100, etc)

And they’re supposed to feel bad for the consumer?

IMO a person who shows no loyalty should get slapped with the sticker and the person who buys from the same salesperson that should get the best deal.

I worked in this business for three years and I left because you really start to hate people that try to screw you when you offer a fair deal but because it wasn’t deep into the red for the dealership they take your numbers and go across town.

I’ve seen jagbags that make 10 times more than me want to see the profit statment before agreeing to a deal all for investing hours, days, or weeks just to get a piddling $150 mini commission. People want everything but don’t want to pay for it.

Real estate agents make a fixed commission, a percentage of the selling price. If car dealerships worked like that, I think fewer people would hate them so much. The difference is that dealerships have about a dozen little places they will try and squeeze as much money as possible from. It's a game. Some people like playing games, but most don't.

Isn’t that what MSRP is?? It’s a percentage over the invoice!

Invoice is supposed to be the cost to the dealership and the difference between invoice and MSRP is percentage based but that’s not agreeable for some reason now is it?

I worked in this business for three years and I left because you really start to hate people that try to screw you when you offer a fair deal but because it wasn’t deep into the red for the dealership they take your numbers and go across town.

When customers hate the sales people, and sales people hate the customers, something is wrong. It doesn't have to be this way. The dealership model, at least the state it's in today, is making everyone miserable.

Invoice is supposed to be the cost to the dealership and the difference between invoice and MSRP is percentage based but that’s not agreeable for some reason now is it?

Yes, but then there's the extended warranties, and the undercoating, and the trade-in, and about a dozen other things. Don't even get me started on the financing. I can't think of any other purchase that has so many hoops to jump through (and possibly fall into a mud pit during the process.)

Complaining about customers is a chicken and egg situation. The customers wouldn't be so ruthless if the salespeople weren't such jerks, and the salespeople wouldn't be such jerks if...

When customers hate the sales people, and sales people hate the customers, something is wrong. It doesn't have to be this way. The dealership model, at least the state it's in today, is making everyone miserable.

When customers hate the sales people, and sales people hate the customers, something is wrong. It doesn't have to be this way. The dealership model, at least the state it's in today, is making everyone miserable.

People have such an issue with car pricing because the "actual" price is not clear, and it is clear you are being played by the dealership often. Of course the business has to make a profit to survive. If dealerships were transparent and had no haggle, fair pricing, that would be much better for everyone.

The main source of profit for new car dealerships is not new cars. The profits are really in finance kickbacks, sales of used cars, and warranty service. The rest is gravy. With that in mind, really, shopping for a new car could and should be easy and convenient. Instead, the dealerships continue with their legally mandated franchises rather than allow consumers to buy direct, and then rake over consumers instead of really assisting them with the purchase. Think I'm wrong? See who has all the money for advertising? Think that money comes out of thin air? Who has legislative power? Again, that money is from dealer profits, so much that they can afford to pay for lobbyists to write laws that favor them and keep the dealer model mandatory. Used car dealers? Not so much. As such, you can get either ripped off totally or score a deal on a used car, depending on who plays the game and how good they are at it.

Now, I am never going to say a business should not make a profit. But when the dealership model is mandated, then so should the profit margin be dictated by law. Set it at 3% maximum over actual costs to provide the services of the dealership in selling the car to the consumer. That covers the salesman's fees, the admin fees to title and license, and other overhead not covered by the used car sales and warranty work that dealers provide as well. Otherwise, cancel the dealership mandates, and let the market sort out what model works best for all.

oh boy...we found the guy that has never worked in a sales management role, or in sales outside of a dealer before.

yes, dealers are entitled to make money. every business is. the sales people are entitled to make money, too.

but if you don't think that dealers aren't making money even when you get $5k off of a Camry or $15k off of an F-150 you are absolutely out of your gourd. why? no business that wishes to remain open would agree to *any* deal that they are truly losing money on. invoice is a BS term that is not what the dealer paid for the car. come on now.

there are a whole bunch of different rebates that the manufacturer gives back to the dealer on a per-car basis. usually it's a fixed number (say, $1000) per car. most sales departments across all industries also have what is called "manufacturing benefit" that allows branded stores receive a kickback at the end of the month that depends on what car, trim, options, etc were sold. higher trim/option/profit models have higher kickbacks, but then higher volume/lower profit models have lower kickbacks but that is offset by the sheer number that are sold. then each individual model may have dealer incentives on them, or money that the carmaker gives the dealer to "buy" them and let them sit on the lot. I've seen them be as much as $10k before. sometimes they're on new models to get the new model year on the lots, and sometimes they're on slow-movers. usually though the highest "dealer incentives" are on the sweet spot of "high-volume, high-profit" vehicles like pickup trucks.

Dealerships make the vast majority of their profit from used cars and the service department.

There's zero reason to pay the dealer-markup/market-adjustment/whatever-the-dealer-wants-to-call-it on a new one. Those only exist to see how much extra they can get someone to pay; most places cave fairly easily when you ask them to take it off. Once they do, they act like they did you a huge favor to get you such a great deal. It's a sales tactic - if you already think you got them to cave on the markup, you're more likely to pay the actual MSRP.

Everybody knows the dealership needs to make a profit, but new cars are *not* what they depend on for that. Paying markup just means you're forking over extra money to give the sales staff a bonus. That's it. That money rarely goes to anything else. If they actually need it to stay afloat, that's a red flag that they're already on their way to shutting the doors.

Well it’s going to set pricing now so sales people used to have a shot of making 6 figures if they really tried to making 50k.

The part that’s irritating is a lot of people that don’t want to be ripped off are ripping off the sales team (below invoice offers, shopping 20 dealerships to save $100, etc)

And they’re supposed to feel bad for the consumer?

IMO a person who shows no loyalty should get slapped with the sticker and the person who buys from the same salesperson that should get the best deal.

I worked in this business for three years and I left because you really start to hate people that try to screw you when you offer a fair deal but because it wasn’t deep into the red for the dealership they take your numbers and go across town.

I’ve seen jagbags that make 10 times more than me want to see the profit statment before agreeing to a deal all for investing hours, days, or weeks just to get a piddling $150 mini commission. People want everything but don’t want to pay for it.

It sounds like you worked for a $hithead of a dealer who screwed you and the other sales staff while raking in the money. If your owner/sales manager was truly selling for a good deal, with no hoopla, then each and every one of your jagbag customers would have signed the deal or come back to you once they saw that it was fair after comparing with the next dealer.

How else could that dealer across town make that customer happy when you could not? I can only assume that they were not losing money on cars, or if they were, then they understood that volume and a good service department makes up for losing money on a new car.

Loyalty? Really? Dude, when you don't buy something more than once every few years and most sales staff turns over faster than hamburgers flipping at McDonalds, what loyalty can you have? Were you going to be there five years down the road when they finally pay down the note and think about buying something new?

There are honest people making six figures selling new cars, but not many. Used car dealers can make sweet, sweet money as the used market has huge margins and little to no costs. That's why the best sales people sell used cars, not new. They hire folks off the street to harass new car shoppers and use management to keep them processing orders without losing too much money.

People don't remember what a thing the PT Cruiser was. I recall how an illegal...um...I mean undocumented pre-citizen migrant escaping horrible conditions in his home land, plowed into the back of my Benz. And then just walked off like nothing happened while the cops laughed. Anyhow, the rental company gave me one of the first PTs on the road. I had people coming up to me in parking lots wanting to look at it. How times have changed...at least in Chrysler land. The other stuff is the same.

I have no idea what a car costs. I recently bought a large Chevy family truckster SUV. The salesman showed me the "dealer invoice" and said he'd sell it to me for his "cost." I thought, what the hell is that? Does that even mean anything? I offered him 10% less, and he took the offer. Which means I probably paid more than I had to. But I can console myself by repeating over and over, "I got it for 10% under invoice."

About two years ago my local Honda dealer decided to add a "mandatory" $1100 "Protection Package" (mud flaps, all season mats, seat protectant, etc) to the price of every new CR-V. Apparently, as PT Barnum said, there's a sucker born every ten minutes. I laughed at them and bought a new Mazda CX-5.